April 11, 2011- A major donor to Gov. Scott Walker was charged Monday with funneling more than $60,000 in illegal campaign contributions through his railroad employees during the last election.

William Gardner, president and chief executive officer of Wisconsin & Southern Railroad Co., has agreed to plead guilty to two felony counts - one for exceeding the campaign contribution limits and a second for giving company and personal funds to others so they could make political donations. Individuals can give no more than $10,000 to gubernatorial candidates.

Under the deal, prosecutors are asking that Gardner be sentenced to two years' probation.

"Because he was cooperative and accepted responsibility at the outset - providing much of the evidence against himself - we are not recommending jail time," said Milwaukee County Assistant District Attorney Bruce Landgraf, who investigates election and campaign matters.

Although Milwaukee prosecutors handled the case, the charges were filed in Washington County, where Gardner lives. Each of the two felony counts carries a maximum penalty of 3 ½ years of combined prison and extended supervision and a $10,000 fine.

Gardner issued a statement Monday acknowledging his mistakes.

In that written statement, the 63-year-old railroad executive said he didn't initially realize that what he and others were doing was improper. The criminal complaint says Gardner took several steps to conceal the scheme and that the illegal contributions came to light only when a former friend of Gardner's alerted state officials.

"I made and asked others to make these contributions, and I am responsible for having the company reimburse some individuals," Gardner stated. "My actions were against the law and wrong, and I take full responsibility."

Walker said in a statement that his campaign acted quickly to return the illegal donations from Gardner and cooperated with the investigation. Over the years, the first-term Republican governor received more than $50,000 in illegal contributions from Gardner and his employees, according to the complaint.

Last year, Walker returned some $40,000 to Gardner and a handful of his company workers after the railroad official informed state regulators that he had been using company funds to reimburse his workers for their campaign contributions.

It is illegal in Wisconsin to give corporate money to political candidates.

The state Government Accountability Board is expected to announce that more than a half-dozen of Gardner's employees will pay civil forfeitures of $250 each and that Gardner's corporation will pay about $166,000.

One election lawyer said he is not surprised that Gardner is getting off with such a light penalty.

"Although these are serious criminal allegations, the mitigating factor that might preclude jail time is the fact the Gardner notified the GAB of his crimes before he was caught," said Michael Maistelman.

Milwaukee County prosecutors have been conducting a John Doe probe into the allegations against Gardner. The Journal Sentinel first reported the illegal donations last summer and the John Doe probe late last year.

According to the 12-page criminal complaint, Gardner told several employees in 2009 and 2010 to donate money to Walker and file expense reports with the railroad to cover the donations. He told them not to send their checks until they received the money from the railroad.

Gardner continued to solicit employees for such donations even after a former female friend informed him she had reported the situation to the Government Accountability Board. The former friend - who is not identified by name in the complaint - on April 19, 2010, informed Gardner and an attorney mediating a dispute between them that she had gone to election authorities.

"Knock yourself out," Gardner responded in an email. "I did nothing wrong and have broken no law."

The former friend did not identify the name of the company when she reported the situation to the board, but an attorney there was able to figure out the railroad was involved.